“A strong rise in interest rates, new international financial turmoil or other economic shocks could trigger a sharp fall in property prices and an abrupt slowdown in household demand for goods and services,” the agency said in a statement.

“In order to ensure that the Norwegian economy is well prepared to face potential economic shocks, it is important that the capital adequacy levels built up by the banks after the financial crisis are not impaired,” it added. (Reporting by Camilla Knudsen, writing by Terje Solsvik, editing by Gwladys Fouche)